Making sense of Windows' irrational pricing and licensing

A few weeks ago, Microsoft announced it was cutting the price of retail, shrink-wrapped copies of Windows Vista. The new suggested price for an upgrade edition of Windows Vista Ultimate is $219, down from $299. The cost of an upgrade edition of Vista Home Premium drops to $129 from $159. Those price cuts were effective with the release of Vista Service Pack 1 in mid-March, and the actual prices that people pay (the so-called street price) will invariably be lower: Amazon, for example, is offering discounts on the upgrade editions of Vista Ultimate and Home Premium for $195 and $95, respectively. The full versions are $300 and $216.

Those prices are, frankly, higher than what any sane person would pay. You can get a better deal direct from Microsoft, just by installing an unlicensed copy of Windows and not activating it within the first 30 days. As I noted back in December, Microsoft will sell you a fully legal Vista Ultimate license for $199, no questions asked, as part of its “get legal” program. In fact, Microsoft’s direct prices are significantly better than the suggested retail prices and practically identical to the discounted prices available from partners like Amazon.

There's also some good common-sense advice for Microsoft in there regarding Vista marketing, and I agree with almost all of it. It's just too complex to buy and upgrade Windows these days.